Practice Management
The Never-Ending Sustainable Growth Rate Debate Gregory M. Worsowicz, MD, MBA, Sarah D’Orsie, Scott R. Laker, MD INTRODUCTION For the past several years, Congress has spent time, effort, and money patching the Medicare Sustainable Growth Rate (SGR) formula to avoid major cuts to Medicare physician reimbursement. As recent as this year, legislation was required to avert a 24% cut in Medicare payments to physicians [1]. The desire for a permanent fix to the SGR formula linked to paying for quality care has led to bipartisan congressional support of physician payment reform. Although physicians or physician groups may support or oppose individual legislation, certain outcomes appear inevitable. The concepts proposed and supported by House Energy and Commerce, House Ways and Means, and Senate Finance Committees in House bill 4015/S.2000 are supported by both Congress and many medical societies [1-3]. In this legislation, 3 key principles are linked to the SGR fix: appropriate use of services, the valuation of physician services, and an emphasis on quality care.
APPROPRIATE USE Appropriate use is a term that seems intuitive but is challenging to fully define. Without definitive quality metrics and clear guidelines, it is difficult to determine what might be in the best interest of the patient versus what one might consider “wasteful overutilization.” Early versions of the legislation proposed to focus on some of the most expensive procedures, which included piloting programs for reducing the ordering of advanced imaging. This included a requirement for the ordering physician to review “appropriateness criteria” before ordering these examinations. For ordering physicians whose use or volumes were inconsistent from their peers (ie, “outliers”), there would be a prior authorization requirement for Medicare payment. The Appropriate Use Criteria would be specified by the Department of Health and Human Services from those developed or endorsed by national professional medical specialty societies or other entities. The secretary of the Department of Health and Human Services also would identify clinical decision support tools that ordering professionals could use when deciding on ordering specific imaging. In several systems, the use of clinical decision support tools has been shown to cut costs from duplicate or unnecessary imaging [2,4]. Based on program results, the secretary would have the ability to expand the Appropriate Use Criteria to other services in the future [2]. Although this language was softened in the final version of the bill, it is reasonable to assume that we can expect more movement toward appropriate use checks and balances.
SERVICE VALUATION This legislation could increase the activity of the Centers for Medicare and Medicaid Services (CMS) developed “misvalued code initiative.” The proposal would set a target for identifying and re-evaluating “misvalued” services under the current physician fee schedule. The Government Accountability Office would be directed to study the American Medical Association’s Relative Value Scale Update Committee (RUC) processes. Selected professionals would be tapped to provide information to assist the Department of Health and Human Services with this process as well as to provide survey data that is currently collected by the RUC. This move toward supplanting the RUC follows an increase of the number of instances in which CMS has rejected RUC recommended values for Current Procedural Terminology codes in the past several years [5]. PM&R 1934-1482/14/$36.00 Printed in U.S.A.
G.M.W. Physical Medicine and Rehabilitation, University of Missouri, Columbia, MO. Address correspondence to: G.M.W., Department of PM&R, University of Missouri, One Hospital Drive, Columbia, MO 65212; e-mail: [email protected] Disclosure: nothing to disclose S.D’O. AAPM&R, Washington, DC Disclosure: employment, AAPM&R staff S.R.L. Department of Physical Medicine and Rehabilitation, University of Colorado, Aurora, CO Disclosure: nothing to disclose
ª 2014 by the American Academy of Physical Medicine and Rehabilitation Vol. 6, 739-741, August 2014 http://dx.doi.org/10.1016/j.pmrj.2014.07.006
739
740
Worsowicz et al
SUSTAINABLE GROWTH RATE DEBATE
Currently, CMS uses several indicators to identify and review specific codes. These include the following:
High volume codes never reviewed by the American Medical Association’s RUC Significant utilization spikes over a specific time period Codes billed together more than 75% of the time Site of service anomalies (eg, inpatient volume surpasses outpatient volume) Services primarily furnished by one specialty now performed by a different specialty [6]
Several of the services provided by physiatrists have come under review, with subsequent adjustments. These services are noted in Table 1 [7].
QUALITY Quality payment initiatives for physicians have been implemented in a variety of formats. Some of the approaches have included the following: meaningful use for electronic health records, Physician Quality Reporting System, and shared savings programs. Congress is supporting a new 2-pronged approach for physicians to fulfill quality reporting requirements. Physicians can either participate in a Merit-based Incentive Payment System (MIPS) or an alternative payment model (APM), which includes assuming double-sided risk and a quality measure component (Figure 1) [8]. The MIPS program would be intended to streamline meaningful use, Physician Quality Reporting System, and the value-based modifier into a single reporting structure. Physician payments would be adjusted based on performance in 4 assessment categories:
Figure 1. Options for payment adjustment. ACO ¼ accountable care organization; APM ¼ alternative payment model; MIPS ¼ Merit-based Incentive Payment System; PCMH ¼ patient-centered medical home.
Physicians will be allowed to either report individually or as a group. These measures will be reported and considered on an annual basis. Participation in the MIPS program will have some flexibility so that physicians can select what approved measures best fit their practice and patients. Another option under MIPS would include participation in a qualified clinical data registry maintained by physician specialty organizations. At-risk payment adjustments for physicians who participate in MIPS will begin in 2018. These
at-risk payments will be based on a composite score (0-100) compared with a performance threshold. Professionals who score at the threshold will not receive a payment adjustment, whereas those who score above the threshold receive a positive payment adjustment and those who score below the threshold will have a negative payment adjustment. The legislation is not budget neutral, which means that the lower performers do not pay for the incentives of the higher performers through penalties. Therefore, there is no cap on the number of physicians eligible for incentive payments. If every Medicare-eligible physician achieves a higher score than the threshold, each of those physicians would be given an incentive payment. These incentive adjustments are in addition to the 0.5% guaranteed annual adjustment through 2023. Professionals who fail to report at all on quality measures and who are not participating in an APM will receive the maximum payment penalty for that year. These negative payment adjustments will increase annually until they are capped at 9% in 2021 (Table 2) [2,3]. As noted in Figure 1, physicians who receive a significant portion of their revenue from an APM with risk sharing and quality reporting, would be exempt from the reporting and performance thresholds of the MIPS system. Although the most commonly known APMs (patient-centered medical
Table 1. CMS potentially misvalued code impact
Table 2. Negative payment adjustment
Quality Resource Use Clinical Practice Improvement Activities Electronic Health Records Meaningful Use
2013 2014 2015
NCS/EMG 66% decrease in reimbursement Interlaminar epidural procedures, 58% decrease in reimbursement Under review: Ultrasonic guidance for needle placement
CMS ¼ Centers for Medicare and Medicaid Services; EMG ¼ electromyography; NCS ¼ nerve conduction studies.
Y
% Negative Payment Adjustment
2018 2019 2020 2021
4 5 7 9
PM&R
home, payment bundling, and accountable care organizations) are listed in Figure 1, CMS will consider qualifying any new and innovative double-sided risk model that is presented during the appropriate consideration period. Many physiatrists who work in small private practices (individual or group, single or multispecialty) may not be involved in an APM and required to participate in MIPS, whereas physiatrists in larger institutional settings may have a greater opportunity of meeting their quality requirement by participation in an APM [9].
CONCLUSION In summary, the new legislative proposal seeks to phase out a fee-for-service system in favor of a pay-for-performance system, with an emphasis on the value of physician services and the appropriate use of those services. There are many opportunities to achieve positive reimbursement adjustments for physiatrists who demonstrate better patient outcomes by using a multidisciplinary, coordinated approach to care, a concept that physiatrists have used for decades. Although many changes may still occur by the end of the current SGR patch, which sunsets in April 2015, the current legislation is likely to be considered in both the House and the Senate later this year. All physicians need to be aware of the looming changes and future requirements with regard to Medicare physician payments and whether or not someone is monitoring these potential changes for their practice.
Vol. 6, Iss. 8, 2014
741
REFERENCES 1. JAMA Forum: Fixing the (un)sustainable growth rate formula: Shifting from volume to value. Available at http://newsatjama.jama.com/2013/12/06/ jama-forum-fixing-the-unsustainable-growth-rate-formula-shifting-fromvolume-to-value/. Accessed on June 16, 2014. 2. Department of Health and Human Services. Centers for Medicare and Medicaid Services. Letter to Glenn M. Hackbarth. Available at http://www.cms. gov/Medicare/Medicare-Fee-for-Service-Payment/SustainableGRatesConFact/ Downloads/CY2014-MedPAC-signed.pdf. Accessed on June 11, 2014. 3. U.S. House of Representatives. Energy and Commerce Committee. Repealing and replacing the sustainable growth rate. Available at http:// energycommerce.house.gov/fact-sheet/repealing-and-replacing-sustainablegrowth-rate. Accessed on June 11, 2014. 4. ACP applauds introduction of bipartisan bill to eliminate Medicare SGR Formula. Available at http://www.acponline.org/pressroom/bipartisan_ bill_eliminate_srg.htm. Accessed June 9, 2014. 5. SGR replacement policy draft endorses use of appropriate use criteria in medical imaging ordering. Available at http://www.itnonline.com/article/ sgr-replacement-policy-draft-endorses-use-appropriate-use-criteria-medicalimaging-ordering. Accessed June 16, 2014. 6. SGR Repeal and Medicare Provider Payment Modernization Act of 2014 (H.R. 4015/S. 2000). Available at http://www.acponline.org/acp_policy/ policies/faqs_sgr_repeal_bill_2014.pdf. Accessed on June 11, 2014. 7. AMA/Specialty Society RVS Update Committee (RUC). Available at http:// www.nhpf.org/library/handouts/Levy.slides_03-05-10.pdf. Accessed on June 16, 2014. 8. American Academy of Physical Medicine and Rehabilitation. 2013 NCS and EMG Cuts. Available at http://www.aapmr.org/practice/resources/ reimbursement/Pages/NCS-and-EMG-Cuts-Projected-for-2013.aspx. Accessed on June 16, 2014. 9. Medicare Sustainable Growth Rate (SGR) Repeal. Scott Laker MD, Chair Health Policy and Legislation Committee, AAPM&R. Available at http:// www.youtube.com/watch?v¼iqOjaJI0-nA&feature¼youtube. Accessed on June 16, 2014.
The Never-Ending Sustainable Growth Rate Debate Gregory M. Worsowicz, MD, MBA, Sarah D’Orsie, Scott R. Laker, MD INTRODUCTION For the past several years, Congress has spent time, effort, and money patching the Medicare Sustainable Growth Rate (SGR) formula to avoid major cuts to Medicare physician reimbursement. As recent as this year, legislation was required to avert a 24% cut in Medicare payments to physicians [1]. The desire for a permanent fix to the SGR formula linked to paying for quality care has led to bipartisan congressional support of physician payment reform. Although physicians or physician groups may support or oppose individual legislation, certain outcomes appear inevitable. The concepts proposed and supported by House Energy and Commerce, House Ways and Means, and Senate Finance Committees in House bill 4015/S.2000 are supported by both Congress and many medical societies [1-3]. In this legislation, 3 key principles are linked to the SGR fix: appropriate use of services, the valuation of physician services, and an emphasis on quality care.
APPROPRIATE USE Appropriate use is a term that seems intuitive but is challenging to fully define. Without definitive quality metrics and clear guidelines, it is difficult to determine what might be in the best interest of the patient versus what one might consider “wasteful overutilization.” Early versions of the legislation proposed to focus on some of the most expensive procedures, which included piloting programs for reducing the ordering of advanced imaging. This included a requirement for the ordering physician to review “appropriateness criteria” before ordering these examinations. For ordering physicians whose use or volumes were inconsistent from their peers (ie, “outliers”), there would be a prior authorization requirement for Medicare payment. The Appropriate Use Criteria would be specified by the Department of Health and Human Services from those developed or endorsed by national professional medical specialty societies or other entities. The secretary of the Department of Health and Human Services also would identify clinical decision support tools that ordering professionals could use when deciding on ordering specific imaging. In several systems, the use of clinical decision support tools has been shown to cut costs from duplicate or unnecessary imaging [2,4]. Based on program results, the secretary would have the ability to expand the Appropriate Use Criteria to other services in the future [2]. Although this language was softened in the final version of the bill, it is reasonable to assume that we can expect more movement toward appropriate use checks and balances.
SERVICE VALUATION This legislation could increase the activity of the Centers for Medicare and Medicaid Services (CMS) developed “misvalued code initiative.” The proposal would set a target for identifying and re-evaluating “misvalued” services under the current physician fee schedule. The Government Accountability Office would be directed to study the American Medical Association’s Relative Value Scale Update Committee (RUC) processes. Selected professionals would be tapped to provide information to assist the Department of Health and Human Services with this process as well as to provide survey data that is currently collected by the RUC. This move toward supplanting the RUC follows an increase of the number of instances in which CMS has rejected RUC recommended values for Current Procedural Terminology codes in the past several years [5]. PM&R 1934-1482/14/$36.00 Printed in U.S.A.
G.M.W. Physical Medicine and Rehabilitation, University of Missouri, Columbia, MO. Address correspondence to: G.M.W., Department of PM&R, University of Missouri, One Hospital Drive, Columbia, MO 65212; e-mail: [email protected] Disclosure: nothing to disclose S.D’O. AAPM&R, Washington, DC Disclosure: employment, AAPM&R staff S.R.L. Department of Physical Medicine and Rehabilitation, University of Colorado, Aurora, CO Disclosure: nothing to disclose
ª 2014 by the American Academy of Physical Medicine and Rehabilitation Vol. 6, 739-741, August 2014 http://dx.doi.org/10.1016/j.pmrj.2014.07.006
739
740
Worsowicz et al
SUSTAINABLE GROWTH RATE DEBATE
Currently, CMS uses several indicators to identify and review specific codes. These include the following:
High volume codes never reviewed by the American Medical Association’s RUC Significant utilization spikes over a specific time period Codes billed together more than 75% of the time Site of service anomalies (eg, inpatient volume surpasses outpatient volume) Services primarily furnished by one specialty now performed by a different specialty [6]
Several of the services provided by physiatrists have come under review, with subsequent adjustments. These services are noted in Table 1 [7].
QUALITY Quality payment initiatives for physicians have been implemented in a variety of formats. Some of the approaches have included the following: meaningful use for electronic health records, Physician Quality Reporting System, and shared savings programs. Congress is supporting a new 2-pronged approach for physicians to fulfill quality reporting requirements. Physicians can either participate in a Merit-based Incentive Payment System (MIPS) or an alternative payment model (APM), which includes assuming double-sided risk and a quality measure component (Figure 1) [8]. The MIPS program would be intended to streamline meaningful use, Physician Quality Reporting System, and the value-based modifier into a single reporting structure. Physician payments would be adjusted based on performance in 4 assessment categories:
Figure 1. Options for payment adjustment. ACO ¼ accountable care organization; APM ¼ alternative payment model; MIPS ¼ Merit-based Incentive Payment System; PCMH ¼ patient-centered medical home.
Physicians will be allowed to either report individually or as a group. These measures will be reported and considered on an annual basis. Participation in the MIPS program will have some flexibility so that physicians can select what approved measures best fit their practice and patients. Another option under MIPS would include participation in a qualified clinical data registry maintained by physician specialty organizations. At-risk payment adjustments for physicians who participate in MIPS will begin in 2018. These
at-risk payments will be based on a composite score (0-100) compared with a performance threshold. Professionals who score at the threshold will not receive a payment adjustment, whereas those who score above the threshold receive a positive payment adjustment and those who score below the threshold will have a negative payment adjustment. The legislation is not budget neutral, which means that the lower performers do not pay for the incentives of the higher performers through penalties. Therefore, there is no cap on the number of physicians eligible for incentive payments. If every Medicare-eligible physician achieves a higher score than the threshold, each of those physicians would be given an incentive payment. These incentive adjustments are in addition to the 0.5% guaranteed annual adjustment through 2023. Professionals who fail to report at all on quality measures and who are not participating in an APM will receive the maximum payment penalty for that year. These negative payment adjustments will increase annually until they are capped at 9% in 2021 (Table 2) [2,3]. As noted in Figure 1, physicians who receive a significant portion of their revenue from an APM with risk sharing and quality reporting, would be exempt from the reporting and performance thresholds of the MIPS system. Although the most commonly known APMs (patient-centered medical
Table 1. CMS potentially misvalued code impact
Table 2. Negative payment adjustment
Quality Resource Use Clinical Practice Improvement Activities Electronic Health Records Meaningful Use
2013 2014 2015
NCS/EMG 66% decrease in reimbursement Interlaminar epidural procedures, 58% decrease in reimbursement Under review: Ultrasonic guidance for needle placement
CMS ¼ Centers for Medicare and Medicaid Services; EMG ¼ electromyography; NCS ¼ nerve conduction studies.
Y
% Negative Payment Adjustment
2018 2019 2020 2021
4 5 7 9
PM&R
home, payment bundling, and accountable care organizations) are listed in Figure 1, CMS will consider qualifying any new and innovative double-sided risk model that is presented during the appropriate consideration period. Many physiatrists who work in small private practices (individual or group, single or multispecialty) may not be involved in an APM and required to participate in MIPS, whereas physiatrists in larger institutional settings may have a greater opportunity of meeting their quality requirement by participation in an APM [9].
CONCLUSION In summary, the new legislative proposal seeks to phase out a fee-for-service system in favor of a pay-for-performance system, with an emphasis on the value of physician services and the appropriate use of those services. There are many opportunities to achieve positive reimbursement adjustments for physiatrists who demonstrate better patient outcomes by using a multidisciplinary, coordinated approach to care, a concept that physiatrists have used for decades. Although many changes may still occur by the end of the current SGR patch, which sunsets in April 2015, the current legislation is likely to be considered in both the House and the Senate later this year. All physicians need to be aware of the looming changes and future requirements with regard to Medicare physician payments and whether or not someone is monitoring these potential changes for their practice.
Vol. 6, Iss. 8, 2014
741
REFERENCES 1. JAMA Forum: Fixing the (un)sustainable growth rate formula: Shifting from volume to value. Available at http://newsatjama.jama.com/2013/12/06/ jama-forum-fixing-the-unsustainable-growth-rate-formula-shifting-fromvolume-to-value/. Accessed on June 16, 2014. 2. Department of Health and Human Services. Centers for Medicare and Medicaid Services. Letter to Glenn M. Hackbarth. Available at http://www.cms. gov/Medicare/Medicare-Fee-for-Service-Payment/SustainableGRatesConFact/ Downloads/CY2014-MedPAC-signed.pdf. Accessed on June 11, 2014. 3. U.S. House of Representatives. Energy and Commerce Committee. Repealing and replacing the sustainable growth rate. Available at http:// energycommerce.house.gov/fact-sheet/repealing-and-replacing-sustainablegrowth-rate. Accessed on June 11, 2014. 4. ACP applauds introduction of bipartisan bill to eliminate Medicare SGR Formula. Available at http://www.acponline.org/pressroom/bipartisan_ bill_eliminate_srg.htm. Accessed June 9, 2014. 5. SGR replacement policy draft endorses use of appropriate use criteria in medical imaging ordering. Available at http://www.itnonline.com/article/ sgr-replacement-policy-draft-endorses-use-appropriate-use-criteria-medicalimaging-ordering. Accessed June 16, 2014. 6. SGR Repeal and Medicare Provider Payment Modernization Act of 2014 (H.R. 4015/S. 2000). Available at http://www.acponline.org/acp_policy/ policies/faqs_sgr_repeal_bill_2014.pdf. Accessed on June 11, 2014. 7. AMA/Specialty Society RVS Update Committee (RUC). Available at http:// www.nhpf.org/library/handouts/Levy.slides_03-05-10.pdf. Accessed on June 16, 2014. 8. American Academy of Physical Medicine and Rehabilitation. 2013 NCS and EMG Cuts. Available at http://www.aapmr.org/practice/resources/ reimbursement/Pages/NCS-and-EMG-Cuts-Projected-for-2013.aspx. Accessed on June 16, 2014. 9. Medicare Sustainable Growth Rate (SGR) Repeal. Scott Laker MD, Chair Health Policy and Legislation Committee, AAPM&R. Available at http:// www.youtube.com/watch?v¼iqOjaJI0-nA&feature¼youtube. Accessed on June 16, 2014.
